What Are The Differences Between a Personal Representative, Financial Power of Attorney and a Health Care Power of Attorney

In this Article, I am revisiting a commonly asked set of questions. What is the difference between all of these roles, Personal Representative, Power of Attorney whether Financial or Health Care?

A Personal Representative: Commonly referred to as an Executor of an estate is an individual (or perhaps an institution) designated to administer the estate of a decedent.  

  1. As a fiduciary, a Personal Representative must settle and distribute the estate of the decedent as efficiently as possible by adhering to the directions outlined in the decedent’s Last Will and Testament. If the decedent did not create a Will, then by the Intestate laws of Idaho.

  2. The primary duty is to protect the estate in a manner consistent with the decedent’s wishes.  Although this may appear relatively simple, it is important that the Personal Representative understand the responsibilities associated with the position.  I highly caution people to not view the Estate and themselves as one and the same, for failure to adhere to these duties and responsibilities can result in the filing of lawsuits against the Personal Representative of the estate for breach of fiduciary duty.

  3. Generally speaking, a Personal Representative is responsible for collecting the assets of the estate, protecting the estate property, preparing an inventory of the property, paying various estate expenses, paying valid claims (including debts and taxes) against the estate, representing the estate in claims against others, and eventually distributing the estate property to the beneficiaries.  In the event the decedent passed away with a Will, the Will may often impose additional duties on the Personal Representative that are not required by law.  

A Financial Power of Attorney: is a legal document that allows one person to act for another person, but the authority comes with duties and responsibilities.

  1. The giver of the authority is known as the principal, while the receiver is referred to as an agent. The agent has both a legal duty to the principal and the duties granted by the power of attorney document.

  2. Once a principal selects an agent, he/she completes a legal power of attorney document.

  3. The document names:

    1. The principal,

    2. The agent,

    3. All powers the agent receives,

    4. Any specific limits placed on the agent's power are listed on the document,

    5. Any alternate agents to act if the first agent is unable to act, and

    6. sometimes a termination date. The termination date is the day the agent no longer has the authority to act for the principal and is often used on a power of attorney that is granted for a specific reason only, such as the purchase of a home.  

An agent's duties vary depending on what types of powers the principal has granted. Agents may be responsible for signing documents for specific transactions, i.e. loan papers for a home or car, or banking for the principal. An agent might have the power to sign various documents that require the signature of the principal and could represent the principal in front of the Internal Revenue Service. Agents might make gifts or donations on behalf of the principal, if given the specific authority to do so in the power of attorney document, or may have the power to do all of the above and more.

The agent has a legal duty to the principal; he/she must act in the principal's interests and not his/her own when acting as an agent. Agents should keep records of all duties performed on behalf of the principal in case the principal or a court asks for an accounting of the agent's activities. The power of attorney document typically must be filed in the county land records if the agent is signing real estate documents for the principal.

The power of attorney terminates at the death of the principal or in the case of a general Power of Attorney, when the principal revokes it. An agent can continue to act if the principal is incapacitated if that power is specified in the power of attorney document, called a Durable Power of Attorney. An agent can resign, by notifying the principal in writing, if he/she no longer feels he/she can perform the duties, or no longer wants to perform the duties. Although a power of attorney typically begins once the principal signs the document, some powers of attorney don't begin until the principal can no longer act for himself. The power of attorney document itself states when the powers begin.

A Health Care Power of Attorney: is a legal document that allows one person to act for another person if that person becomes incapacitated, perhaps because of a mental illness like dementia, he/she can no longer make health care decisions for himself as he/she once did. If he created a durable medical power of attorney, he named an agent to make his health care decisions if and when he becomes unable to do so and this agent is responsible for following his wishes closely and acting in his best interests.

The person who creates and signs the durable medical power of attorney is called the principal, while the person who is given the power to act on the principal's behalf is generally called the health care agent or proxy. A durable medical power of attorney gives the health care agent broad power and responsibility to make decisions regarding the principal’s medical treatment, including medication, tests, nourishment and hydration, as well as decisions regarding surgery, doctors, hospitals and rehabilitation facilities. However, the principal can limit the agent’s authority and responsibilities by including specific limitations in the document itself.

A principal must be of sound mind when he creates and signs the durable medical power of attorney; thus, it must be signed before the principal becomes incapacitated. Once signed, the agent can only use the power of attorney when the principal is incapacitated, since the agent has no authority prior to the principal’s incapacitation. Depending on state law, before the agent can act, licensed physicians may have to provide written certification that the principal is incapacitated. If, after incapacity, the principal regains his ability to make decisions for himself and is no longer incapacitated, the agent cannot continue to act on his behalf, so the agent has a responsibility to ensure he knows if and when the principal is incapacitated.

When an agent acts on the principal's behalf, she must act with care, competence and diligence. Ultimately, she must have the principal’s best interests at heart. Often, a principal will have a living will or health care directive in addition to his durable medical power of attorney, and the living will or directive helps guide the agent’s decisions. Agents must abide by the directions in a principal’s living will or health care directive. Living wills and directives may spell out the types of medical treatments and life-sustaining measures the principal wants or doesn’t want. For example, a principal’s living will might note that he doesn’t want to go on a respirator or dialysis. A principal may also have a Do Not Resuscitate, or DNR, order, sometimes as part of a living will. If so, the health care agent must ensure the principal’s physicians are aware of this order.


Probate and a Small Estate: Is It Always Required?

Is Probate always required to transfer assets when I pass away? Is there an option if I don’t have much?

Probate is required under one of two circumstances in the state of Idaho:

  1. you personally own any interest in real property; and/or

  2. you own more than $100,000.00 in non-designated probate-able assets.

As you can see, Probate will not always be required when someone passes away. So, what if your estate does not meet either of these criteria?  

In Idaho, the law allows for the collection and disposition of assets, which are not required to go through Probate, through a Small Estate Affidavit, found under Idaho Code 15-3-1201.

In addition to the asset requirement, the affiant must swear to additional information as well.

The law does allow for the avoidance of Probate, but that may not always be your best option. Consider three potential outcomes.

First, did the deceased person have a Will? If so, the provisions of that Will must be carried out. By avoiding Probate, you also avoid the neutral party in the Judge of ensuring that the provisions of your Will are followed. That way your last wishes still have a voice. Otherwise, a potential arises of someone filing a contest.

Second, did the deceased person have debts? If so, the Probate process can allow for the elimination of some of those debts through a notice to creditors and the 4-month limitation on claims that accompanies the notice. If you proceed with the Small Estate Affidavit, you do not benefit from this limitation on filing a claim. Also, if you collect and spend all of the assets in which a creditor has priority, you may be required to refund the creditor long after you spent the money.

Third, did the deceased person have assets outside of the State of Idaho? The other state might not acknowledge the Idaho Small Estate Affidavit.

Probate: Can You Avoid It?

Have you heard that you should do everything possible to avoid Probate? Although Probate is not that dire, here are three common reasons some people desire to avoid Probate; its public nature, time and cost.

  1. What does it mean to avoid Probate due to its public nature? Well, Probate is a civil lawsuit. As a lawsuit, the information supplied to the Probate court is available to the public as required by law under the Freedom of Information Act.

  2. The length of time required often depends on the parties involved and the complexities or simplicities of each family and its members. However, in Idaho, most Probates take anywhere from 6 - 12 months to resolve, with a minimum required time of 6 months.

  3. Price is often the most important factor up front. You should be prepared to pay anywhere from $2,000 to $5,000 to Probate your Will. In many cases your final cost will also include these “fixed costs” of court costs, attorney fees, the cost to publish the Notice to Creditors, and other incidental expenses.

Armed with this understand, here are a few methods in which people attempt to avoid Probate on their own. These methods are not being recommended as a blanket statement, as they have serious hidden traps.

“Payable on Death” or “Transfer on Death” designations can be added to many bank accounts and brokerage accounts.  When the account owner passes away, the funds that remain in those accounts will be distributed to the named beneficiaries without having to go through Probate.

“Joint Tenancy” ownership can also avoid Probate.  A JTWROS can be used for bank accounts, vehicles, and real estate.  When one of the Joint Tenant owners passes away, his or her share disappears and the property is thereafter wholly owned by the remaining Joint Tenant.

“Devolution Agreement” is where property owned by a married couple can pass to the surviving spouse when the first one passes away.  But, this can’t be used unless there are no other intended beneficiaries of the property. As this option is only available to a married couple, you will not avoid Probate when the second spouse passes.

Each method, taken individually can on the surface avoid Probate for whatever property it has authority over and no other. Also, without further intervention Probate will be an eventuality for someone down the road.

There is one option not mentioned that can avoid all of these concerns. That is a Revocable Living Trust. If you properly create it and fund it, a Trust can avoid the public nature, time, and cost of Probate. That is way so many clients prefer to create a Trust.

Probate: Is it required when my spouse passes away?

“My husband recently passed away. Both of our names are on the house, he had a Will, and everything was left to me. Do I still need to go through Probate?”

This question is asked so often, I wish estate planning basics were taught in high school.

The answer is specific to you, but most often the answer is yes, Probate will be required.

It may make zero sense at first, but there is a valid reason for requiring Probate in this situation.

However, not all Estates are required to go through Probate. *See last week’s post.

Then why would a Surviving Spouse be required to Probate the deceased spouse’s Will?

As a general rule, the State of Idaho will not presume that you intend to leave all of your assets to your surviving spouse.

Why? Because, legally, there is no requirement to leave an inheritance to anyone (If you are the surviving spouse and you have been completely disinherited, there are options available to you as well).  

The expectation of an automatic transfer from spouse to spouse, unless explicitly taken by you through legal documentation, does not exist.

If you own it, you can leave it to anybody you choose, whether that person is a spouse, child, friend, charity, etc.

If you created a Will, it holds no legal authority until the Probate Court gives it authority. For the Court to give the Will authority, the Will needs to go through Probate.

If you decide not to create a Will or Trust, the State of Idaho, through its laws of Intestate Succession, will distribute your assets for you. Probate is required for Intestacy because the Probate Judge is required to oversee that your assets are distributed according to the laws of Idaho. Intestacy typically includes leaving assets mostly to your spouse and then some to your kids, no matter their age. That means at age 18, your kids will receive their inheritance and have absolute control over that money.

There are a few options available to you that are less expensive, time consuming and simpler than Probate. If you read that post, it is important to remember that these options may avoid probate on certain assets when the first spouse passes away. Aside from the Trust, those options do nothing to avoid probate when the second spouse passes.  I offer a word of caution. Taking some of these steps to avoid probate on certain assets does not guarantee that you will avoid probate on other assets. Using a Living Trust or a Family Trust is the only available option that allows you the opportunity to avoid probate on all assets for both spouses.

Your Estate is required to go through Probate regardless of your marital status. The unfortunate aspect is that many surviving spouses don’t know that they need to Probate the Will. Failing to Probate a loved one’s Will often results in complications and even legal disputes once the surviving spouse attempts to sell or encumber the property or among those who are to ultimately to inherit the property once both spouses have passed away.

If you live in the Meridian, Eagle, Star, Nampa, or Boise areas of Idaho and you don’t have a Will or Trust, call attorney Justin Jeppesen at 208-477-1785, or visit my website at https://www.jeppesenlaw.com, to ensure that your wishes have a voice and are carried out.


Probate: When is is Required?

Are you concerned about Probate when you or a loved one passes away?

The good news is that Idaho has only two situations where Probate is required*. The bad news is that, without some additional planning, most Idahoans meet one of the situations.

Idaho Code dictates that upon a person’s passing, their Estate is required* to go through the Probate process if one of these two conditions is met: 1) that person owns an interest in real property (ie land, home) regardless of its value; or 2) that person owns more than $100,000 in total Probatable assets.

If a person meets one of these requirements, then their Estate is required* to go through Probate, unless they have made additional Estate Planning steps.Probate is not required* if a person’s Estate does not meet either of these conditions.

If Probate is not required*, how do you officially administer a deceased person’s estate? One option is with a Small Estate Affidavit.  

If after reading the minimal requirements that trigger Probate, and those requirements include your estate, a licensed attorney can easily explain to you the possibility of avoiding probate, plus the pros and cons of using one or more of these options; a Living Trust, payable-on-death beneficiary designations, joint tenancy ownership, community property ownership, or life estate ownership.

All of these options have limitations and a conversation with a lawyer is recommended concerning your personal situation. As, you can read, a Will does not help you avoid Probate, it actually guarantees it.

If you own property worth more than $100,000, or you own any real estate, the most effective means of avoiding Probate is through the use of a Living Trust.  Properly prepared with the assistance of a licensed Attorney or Lawyer is the best way to avoid Probate.

You are invited to call Jeppesen Law to set up your appointment to start working on your Will or Trust based Estate Plan at 208-477-1785.

* As an additional note, Probate is still available to Estates that are not required to go through Probate. If there are concerns, such as family disputes or creditors, you can still apply for Probate.




Probate: How Much Does it Cost?

Some days this profession is easier than others. Today is a difficult one. To the client I spoke with earlier, my heart goes out to you.
So, now on to our topic.

Probate.

The word itself can come with feelings of unease and discomfort. However, that is not always necessary. Much of this ill-feeling toward Probate, I attribute to the few, but definitely possible, contentious, costly, and public Probate litigation. However, outside of those news clips, one of the concerns most often voiced is cost.

Probate in Idaho tends to be less expensive and time consuming when compared to many of our neighboring states.

However, I would not consider Probate inexpensive.

Three factors weigh heavily in determining the final cost associated with your experience in Probate; the type and amount of property involved, family relationships, and the Attorney or Law firm you or your family decide to use.

Another potential cost factor to consider is known, or unknown, creditor’s claims. These costs really depend on the deceased individual. Contested creditor's claims will substantially increase the cost, especially if they were unknown and you intend to dispute them.

If everything works out well (and by well I mean an uncontested, informal probate), you can expect to pay anywhere from $2,000 to $5,000. I use the word “You,” but in reality, the cost of Probate is most often pad out of your Estate. The cost of Probate listed above often includes the fixed costs of court costs, attorney fees, cost to publish the Notice to Creditors, and recording fees.

Before you begin working with an attorney on a Estate you have been placed in charge of, it is a good idea to ask him or her to give you an estimate of what the total cost, plus fees will be. After asking a number of initial inquiries, that attorney should be able to give you an estimate. Better yet, hopefully he or she can offer you a fixed fee plan. This approach encourages efficiency and economy that ultimately works to your benefit.

One thing to consider, if you do not meet one of the legal requirements that trigger Probate, there is still a reason to contact a Lawyer or Attorney.

Lastly, if your goal is to avoid both the cost and the time delay of Probate, a Living Trust or Family Trust is often the best option available.


Probate: What is it?

If you  have had reason to think about or discuss Probate, often that idea or conversation iis shrouded in uncertainty, which causes people to fear it.

The most obvious aspect about Probate that causing anxiety is that it involves death.

With mortality rate hovering right around 100%, chances are that you will deal with Probate at least once, in one context or another.

So, what is Probate? It is simply the administrative process of shutting down a deceased person’s financial life. There is more detail involved, but that is one sentence overview of Probate, which involves five basic steps detailed below.


First, if there is a Last Will and Testament, it must be validated by the Courts in Idaho. In fact, that is the definition of probate, to validate one’s Will.

  • Idaho law requires that a deceased person’s Will be filed in the county where the person resided before death or whichever County he or she owned real property in. Generally, there is no real benefit to selecting one county over another, as all rules are relatively similar.

Second, if there is a Will, it should name the person who will be in charge of carrying out the orders the Will sets in place.  Idaho law typically refers to that person as the Personal Representative (PR), but you may have heard of administrator or executor.

  • Maybe you didn’t create a Will. There is still a possibility the your estate needs to go through Probate. If there is no Will appointing a PR, Idaho law specifies who is entitled to be appointed.  Typically, that will be a surviving spouse if there is one. If not, then the surviving children are entitled to the appointment. [insert prior family dynamics here, and see the potential for disaster.] To me personally, naming a PR is the most important aspect of creating a Will.

Third, the appointed PR gathers all of the deceased person’s assets. This step can be difficult and time consuming.  If you fail to provide guidance for the PR, it can result in extra time and effort from the PR, to which he or she is entitled to a reasonable fee for their efforts. To assist in this step, I provide a binder that contains all the estate planning documents and it has an additional section for the client to organize all of the financial aspects of his or her life.

Fourth, after all of the assets have been gathered, the PR pays any bills of the deceased person. These bills can come from creditors, taxes, etc. The bills are either known or unknown. To find out about unknown bills, the court requires filing a Notice to Creditors. Here in the Boise, Meridian, and Eagle area, you would file the notice with a local newspaper. I.e. Idaho Business Review, The Idaho Statesman, or Press Tribune.

Fifth, after the period of time required for the Notice to Creditor and if there are no on-going disputes concerning the Estate, the PR then distributes the assets according to the Will or, if no Will, to the Heirs at Law and the Estate closes. Thus ending Probate.


Each step of the process works out differently, because each person and their situation is different. But, that is the basic structure of Probate.

If you would like to set up your Will and would like a free initial consultation, please contact Justin at 208-477-1785 or visit https://www.jeppesenlaw.com for more information.


What Happens If I Die Without a Will In Idaho?

There is a common misconception the public at large has regarding the area of Wills and Trusts, and what happens if you die without one.

The most common concern, and the least likely to ever happen (Although still a possibility!) is that the state of Idaho will take all of your personal belongings. Let me explain why.

If you die without a Will, Idaho will create one for you! While not really a Will, Idaho is able to do this through a set of laws called the Laws of Intestate Succession. Depending upon the “Facts” of you life, without a will your property may be divided up between a surviving spouse, children, parents, brothers and sisters, grandparents, uncles and aunts, etc.

Have you ever watched a movie where the main character receives a vast inheritance from a distant or unknown aunt or uncle? Well, more likely than not, the aunt or uncle did not know about the main character as well. The inheritance made its way to the story through the Laws of Intestate Succession.

So, there is the good news. Idaho will probably not take your stuff if you don’t have a Will. The bad news is the limitations you are under if you do not create your own Estate Plan.

First, your wants, wishes and desires will never have a legal voice. To me, this is especially troublesome concerning your minor-aged children and their potential guardians. You are required to follow the generalized laws of Idaho.

Second, you will not have any control over who will become the guardians of your minor children, or who will be in charge of your assets. Anyone in the world can apply for these positions, which can be an uncomfortable thought.

Third, death is only one side to Estate Planning. Many of the most trying-times, both financially and emotionally, occur while you are still alive, but unable to communicate (ie, because of incapacitation, incarceration, or mental inability).

Your best course of action is to hire a competent attorney or lawyer to counsel you through the process and to draft your documents for you. If you do not have a lawyer/attorney to call your own, consider Jeppesen Law to help you spare your loved ones the additional stress of haggling over what you would have wanted done with your things.  After all, there are few things quite as stressful as a family dealing with the death of a loved one coupled, and dealing with the uncertainty of inheritance rights. Call attorney Justin Jeppesen at 208-477-1785 to give your wishes a voice.

Estate Planning for Parents of Minor Kids

The following is the baseline protection I think of when I hear someone mentioning that they are having a child for the first time, or having another child, and they are considering an estate plan.

This list will start out with what I consider the most probable protection needed, not the most crucial.

Power of Attorney for Care and Custody of Minor Children (“POA”): There are a number of different scenarios that the POA would cover. However, the POA does cover those last ditch efforts many of us have attempted before traveling without the kids. As such this is the most probable document needed. Generally speaking, the POA legally appoints someone to “act” as the parent (or more specifically, the agent of the parent) concerning his or her child. While traveling, most parents tend to be first concerned of health care for the kids, and also the potential death caused by travel. The first issue is solved with the POA, as the agent would have the authority to ensure your child’s health care is provided if needed. The POA won’t help in the scenario of death, as POAs lose authority upon death of the POA creator (called the principal).

Term Life Insurance: Why would someone list an insurance product before an estate planning tool? Because, I am making an assumption that the reader is part of a married couple, and all of the kids are apart of the current marriage. If not, please mentally switch Term Life Insurance with the Last Will and Testament. Disclaimer, tons of assumptions are being made here, so do not rely on this statement at all. The passing of one spouse, even if you have kids, legally can be a very simple process even if you do not have a Will. No matter the emotional toil taken, the legal side can happen with some ease. However, the economic impact of losing a spouse, especially a spouse that is the main, or sole, income earner, can be devastating. Term Life Insurance is an inexpensive way to lessen the emotional and financial burden that falls on families when one spouse passes away.

Last Will and Testament: When the last parent of minor children passes away, a Last Will and Testament is crucial for us Idaho residents. In Idaho, the only way to legally nominate a guardian for your minor children is through a validly created Last Will and Testament. It is that simple. Create a Will, name your guardian. Name your alternate guardian if your first guardian cannot or will not act as guardian. And, name your second alternate guardian if your first alternate guardian can’t act.

Minor Children’s Trust: There are two basic types of Trusts, a Testamentary Trust and a Revocable Trust. This writing won’t delve into the differences of these. Just know that either of these types can accomplish the same written goals. There are three basic ways to pass your assets on to your minor kids: 1) no planning at all and they will receive the assets at age 18; 2) simple will based planning and they will receive the assets as age 21; and 3) trust based planning and they will receive the assets when, how, and for whatever event you specify.

In whatever order is most important to you, if you have minor kids, you need a; 1) Will, 2) POA, and 3) Term Life Insurance policy. It is nice to not give an 18 year old or 21 year old all of your money, including life insurance proceeds. So, a trust is beneficial, if not needed in some situations.

If that “What-if” question has ever popped in your mind, you are having your first child, or a second child, and you want to answer those questions, please contact Jeppesen Law, PLLC to assist. 208-477-1785.

Keeping Your Family From Contesting Your Will

Have you ever worried that your family may try to contest your estate plan after you have passed away?

Two issues come to mind. First, is that you have taken the time to write down your desires. It is frustrating to think that someone would try to undermine your goals once you can no longer correct them. Second, this is a valid concern because Will contests can be very damaging to the family members and ugly (not to mention expensive) legal battles.

After losing a loved one, the emotions (especially anger) can be misplaced and directed at an undeserving recipient. People aren’t always thinking clearly due to the emotion fog they are in due to the lost loved one. Families can be torn apart. Sadly, often the one person that had the ability to bring family members back together after a fight is the one they just lost.

This can be exceptionally damaging when families fight over minor children. Often what happens is the child loses Mom and Dad, and if Grandparents fight over who should be the guardians, the child also loses the Grandparents that are not awarded custody.

So, what to do?

The best way of minimizing a potential contest is to have a professionally prepared Will or Trust. A professional understands the key areas that someone would attempt to attack the validity of that Will or Trust and prepare for it. So, how do you avoid, or decrease, the chances of this happening after you pass away?

Have Your Will or Trust Prepared by an Attorney:  Why is this so important? An attorney can custom tailor your Will or Trust in clear, specific language, ensuring the provisions work together and not in conflict with each other. The potential for contest is increased if any of the provisions are conflicting. Do-it-yourself Estate Plans from the internet, Legal Zoom, Rocket Lawyer, or Nolo cannot custom tailor your Will or Trust. If you don’t know what a provision means, how are you going to know how it interacts with other provisions in your Will or Trust? Also, a lawyer will ensure that your Will is properly witnessed to ensure its validity.

Make your Will or Trust Contest Resistant:   Three common contests of an estate plan involve: 1) Mental incompetency; 2) Creating a Will based on coercion or threat; or 3) Enticing someone to make a Will based on a false promise. The signing ceremony helps to minimize contests of Wills or Trusts as the ceremony ensures that none of the above have occurred and it has the creator swear to this in front of witnesses. Those witnesses then swear to this fact in front of a Notary Public.

Inclusion of a No Contest Clause:   A no contest clause is not always required in a Will, but it can be beneficial if you believe your heirs might try to alter your wishes. This clause often reads that any person receiving an inheritance, or potentially receiving an inheritance, from your Will or Trust will forfeit that inheritance if he or she contests any part of the Estate Plan.

Be Specific: It is always easiest for us to say, “Let the kids decide what to do.” However, this seeming innocent mindset is exactly the kindling needed to start a contest when you pass away. My suggestion is to be as specific as possible. Any opportunity for your children’s opinions to have a voice, is an opportunity for conflict. It is your plan. Your opinion matters. Not the kids’.

If you want to have a professionally created Will or Trust and increase the potential of family harmony after you have passed, call Jeppesen Law, PLLC at 208-477-1785 or visit https://calendly.com/idahoestateplanning to schedule your complimentary initial consultation!

Are Online Wills Legal?

I have been asked many times to review Wills and even Trusts generated online.

Some of them were just fine. This is more often the case with Simple Wills.

Many of the more complex wills and trusts were so defective as to be invalid.  They sometimes contained inconsistent or contradictory provisions.

Sometimes they were signed in a way that invalidated them.  

Often they had crucial provisions missing.

Another complication is that each state has its own rules. See the quote below from a law professor.

"There isn't a pat answer I can give anyone, that 'here's what it takes to write your own will,'" said Bill McLoughlin, an estate planning attorney and business law professor at Otterbein University in Westerville, Ohio. "Some states recognize oral wills; some don't. In some states, you have to have the will signed at the end and witnessed by two disinterested parties. But some states require three signatures."

Even if no one contests your will, the courts still have to follow the letter of the law. Many courts will not validate provisions if the will is not properly executed (with the proper notarization and number of witnesses). Courts will also balk at provisions that do not make sense. Even uncontested wills can remain in expensive probate limbo, said McLoughlin. https://www.cnbc.com/id/100388275

The short answer to this question is, “Yes, they can be valid, if you follow the rules of your state correctly.”

But the follow up question should be, “Am I willing to risk the future of my family and heirs to an online cost saving substitute?”


Benefits of using a QTIP trust for asset protection

When creating an estate plan, Idaho couples have a wide range of options. For those who are seeking maximum asset protection, establishing a trust is one of the best possible choices. In particular, a QTIP trust offers a high level of protection, as well as a degree of flexibility.

QTIP stands for Qualified Terminable Interest Property. This type of trust allows a married couple to structure the transfer of assets upon the death of the first spouse. A QTIP trust will allow the surviving spouse to take advantage of the marital deduction, and also gives the surviving spouse the ability to control the distribution of assets. Additionally, all assets included in the trust would be protected from the creditors of the surviving spouse.

When a QTIP trust is created, a personal representative is named. That individual can then choose to make use of either the portability election or a partial QTIP election. This allows the personal representative to ensure that the first spouse’s exclusion amount is put to use and not wasted. From that point forward, the personal representative has a great deal of flexibility in how to use or distribute the assets held in the QTIP trust.

When creating an estate plan, Idaho residents should understand the pros and cons of various asset protection strategies. For many, a QTIP trust provides an excellent path toward retaining assets while protecting against the claims of outside creditors. However, this is just one of many estate planning tools available, and each family will have its own unique goals and needs within the estate planning process.

Source: Forbes, "Estate Plan Recommendations for Married Couples After ATRA", Lewis Saret, May 20, 2014

Living Trust vs. Family Trust

In some situations the name of a legal estate planning document is significant. The name can signify what, when, or how a fiduciary is allowed to represent you, the principal.

One exception is the name of a Revocable Trust, i.e. a Living Trust or a Family Trust.

To be clear, there are multiple types of Trusts available, all with differing names, so let’s just agree to talk about a revocable trust, i.e. the most common trust you will hear about.

Regardless of its name, a Revocable Living Trust, Revocable Family Trust, Living Trust, Family Trust, Husband’s Trust, Wife’s Trust, Kid’s Trust, they should all perform the same or similar functions; avoid probate, reduce or eliminate estate taxes, offer privacy, control distribution of assets, and provide disability or special needs planning, without regard to its title.

With this one narrow exception, the name of the Trust does not have a significant meaning to anyone but you.

Some general guidelines include if you want to leave all of your assets to your family, you can use the term Family Trust.

Conversely, a Living Trust can sometimes signify that the assets may be distributed to a larger number of beneficiaries, including foundations, scholarship funds, and charities, but this option does not exclude family members from being beneficiaries.

Past clients have been real creative with naming their trusts, including longitude/latitude coordinates of their honeymoon or dream vacation, latin phrases, funny phrases, or real short and sweet first names only, as well. It is up to you and how you want people to refer to your trust. If you leave it to me, I go with the family last name_trust. Not real creative, but that’s my comfort zone.

So, unlike the vast difference between a Living Will and a Will, the difference between a Living Trust and a Family Trust is only what you want it to be.

Contact Justin Jeppesen today at 208-562-4900 to get started with your Family Trust or Living Trust. Or, schedule your own complimentary consultation here:  https://calendly.com/idahoestateplanning